Australians lose over AUD $4 billion yearly to energy loyalty tax
Australian households are collectively paying over AUD $4 billion each year in what has been described as an energy 'loyalty tax' because they do not switch energy providers for better deals.
Recent data suggests that 80% of Australian households could be saving at least 17% on their annual energy bills by seeking out more competitive offers, yet the majority remain with their long-term provider and consequently miss out on potential savings.
Missed savings
This phenomenon, often referred to as a 'loyalty tax', results in energy customers paying significantly more for their electricity if they stay with the same plan for consecutive years. Households are estimated to pay over AUD $200 more per year by remaining on an energy plan for longer than twelve months, and up to AUD $300 extra if they continue with the same provider beyond two years.
In New South Wales specifically, analysis indicates that customers could save over AUD $250 annually simply by switching to a typical market offer available from retailers.
Nectr's market approach
In response to these trends, energy retailer Nectr has announced the launch of a new energy plan, Nectr Home Buzz, aiming to provide NSW households with more competitive pricing and easier management of their energy accounts. The plan includes features such as simple pricing, monthly billing, and online tools for tracking usage and account management.
Nectr Home Buzz ranks among the top three most competitive energy deals currently available in NSW, according to the company's assessment.
Hayden Barry, Managing Director at Nectr, commented on the broader context confronting energy consumers.
"As we head into summer, when energy usage tends to spike, every household should be reviewing their power bills to determine whether they are on the energy plan that suits their usage needs. From the outset, Nectr entered the Australian market to clean up energy to give every day Australians access to affordable energy, and our new Nectr Home Buzz plan is designed to do just that."
Comparing energy plans
Australians are being encouraged by Nectr to proactively compare the market, particularly in light of recent pricing changes.
According to Barry, these changes have recently begun to affect Australian households more acutely:
"The changes in energy pricing as of July 1 are just starting to hit the purse strings of many Australians. At Nectr, we encourage energy users to review their power bill, give us a call to see if Nectr Home Buzz fits their energy needs, and give it a try."
"We're committed to bringing affordable energy solutions to Australians and are proud to have Nectr Home Buzz ranked among the top 3 best energy deals on the market for people in NSW, with plans to extend that lead in other Australian markets," Barry said.
Features of the new plan
Nectr Home Buzz aims to make energy management more accessible for households by providing clearly defined pricing structures, regular monthly billing to assist with budget planning, and digital tools designed to empower users with data about their energy consumption. Online account management is also positioned as a central feature, offering greater transparency and oversight of energy use and costs.
The company's messaging focuses on prompting consumers to reconsider any inertia regarding their current energy arrangements. With substantial potential savings at stake, the message from Nectr is that loyalty could be costing consumers dearly each year.
The retail energy market in Australia remains highly competitive, with a range of deals routinely available that may suit varying household usage profiles. Recent industry data indicates that market engagement – such as comparing plans and switching providers – tends to result in lower bills for many households.
